# Choice of reserve asset

None of the code in this system has any control over the reserve asset code. 

It is up to the Trust deployer and each participating user to conduct their own risk assessment of the reserve asset. 

For example: 

* Stable coins may introduce regulatory risk, e.g. the American STABLE Act or similar may suddenly apply to a reedeemable token.
* Centralised stable coins could censor the redemption or pool mechanisms by blocking transfers beyond our control. 
* The reserve asset could experience its own exit scams and/or exploits.
* The reserve asset could somehow be 'wound down' out from underneath users who want to redeem against it It essentially comes down to counterparty risk (e.g. tether) + technical risk (e.g. hacks) + value risk (e.g. worthless/volatile reserve). 
* Rough analysis of notable assets: WETH: Zero counterparty risk, low technical risk, high value risk USDC/DAI: Some counterparty risk, some technical risk, low value risk NFT/partner token: Some counterparty risk, some technical risk, very high value risk.